Financial Support for Oil Market in China
石油市场的金融支持体系研究

As the second largest oil-consuming country,China is affected deeply by the increasing price of the international oil market.Oil price may not be so high if oil production and consumption are considered.However,financial capitals exist behind the supply and the demand of this market such as fund management companies,commercial banks,and investment banks.International oil market has changed to a market behind which financial players stipulate in recent two years.With the increasing crude oil import,China has to adapt to this market.Oil markets include not only the physical dealing market,but also the derivative dealings such as futures,option and swap.From the experiences of the international oil market,oil futures markets such as NYMEX and IPE are the benchmark of crude oil price,and great amount paper dealings are based on the benchmark and some pricing indices.The power of funds,banks and multinational oil companies are so strong that the incredible large quantities in the derivatives markets far exceed that of the physical dealings.Nevertheless,the function of pricing and risk avoiding are used extensively in the derivatives markets.This suggests that participating in the international oil trade must consider these factors.Exchange market and investment fund are related to the oil price too.Facing the financial characteristics of the oil market,China should take measures to control the oil pricing to reflect China's demand.One of these measures is building oil futures market to raise the domestic price,but the oil market includes not only futures market also paper market and advanced physical market.In the domestic market,oil prices are controlled by the government now.Unreasonable oil pricing makes the price signal chaotic,and uneven profit rates in the petroleum production lines arouse conflicts.Oil companies and end users are harried by the price fluctuations and the pricing systems.They cry for markets and instruments to avoid the price risks.Oil derivatives can satisfy this demand.Furthermore,oil companies which explore the oil abroad need financial support too.This suggests that we should consider the market,the exchange rate and the oil funds simultaneously.This paper analyzed the financial players in the oil market and the domestic demands of financial support,and called for the construction of petroleum financial system in China.The basis of this system is the various oil markets and it is the foundation of all kinds of oil derivatives innovations.Operation of oil funds and oil banks is the impetus of market.The laws and the regulations of financial support are the guarantee.Some applicable measures are given to promote the innovation,the supervision and the management.